GNC Holdings, Inc. (NYSE: GNC) announced the grant on September 11, 2017 (the "Grant Date") of a non-qualified stock option to purchase 519,126 shares of the Company's common stock with an exercise price equal to $8.95 per share (the closing price per share of the Company's common stock as reported on the NYSE on the Grant Date) and 519,556 shares of restricted stock to Kenneth A. Martindale as a material inducement to his hiring as Chief Executive Officer of the Company.
Of the total shares of restricted stock, 307,265 shares are "make-whole" awards, of which 67,040 are fully vested upon grant, 106,146 are scheduled to vest on the last trading date of December 2017subject to acceleration to the extent necessary to cover any applicable income and payroll tax withholding resulting from the recognition of ordinary income pursuant to a Section 83(b) election ("Section 83(b) Tax Liability") and 134,079 are scheduled to vest in three equal installments on each of the first three anniversaries of grant subject to acceleration to the extent necessary to cover any applicable Section 83(b) Tax Liability. The remaining 212,291 shares of restricted stock and the stock option will vest in three equal installments on each of the first three anniversaries of grant. Vesting will fully accelerate in the event of death or disability and, in the case of the make-whole awards, a separation from service by reason of involuntary termination by the Company without "cause" or by Mr. Martindale voluntarily for "good reason" (as defined in his employment agreement). In addition, time vested awards that would have vested during the 24 month period following an involuntary termination by the Company without cause or by Mr. Martindale voluntarily for good reason will also vest. The stock option will expire on the tenth anniversary of the Grant Date.
The stock option and the shares of restricted stock were all granted outside the terms of GNC's 2015 Stock and Incentive Plan and approved by the Company's Compensation Committee of the Board of Directors in reliance on the employment inducement exemption under the NYSE's Listed Company Manual Rule 303A.08, which requires public announcement of inducement awards. Pursuant to the requirements of that rule, GNC is issuing this press release.
GNC Holdings, Inc. (NYSE: GNC) - Headquartered in Pittsburgh, PA - is a leading global specialty health, wellness and performance retailer.
GNC connects customers to their best selves by offering a premium assortment of heath, wellness and performance products, including protein, performance supplements, weight management supplements, vitamins, herbs and greens, wellness supplements, health and beauty, food and drink and other general merchandise. This assortment features proprietary GNC and nationally recognized third-party brands.
GNC's diversified, multi-channel business model generates revenue from product sales through company-owned retail stores, domestic and international franchise activities, third-party contract manufacturing, e-commerce and corporate partnerships. As of June 30, 2017, GNC had approximately 9,000 locations, of which approximately 6,800 retail locations are in the United States (including 2,378 Rite Aid franchise store-within-a-store locations) and franchise operations in approximately 50 countries.